‘Bigger is back’ as Escala Partners scales up

Private wealth firm Escala Partners is seeking to become a leading player in the Australian advice landscape, helped by backing from US player Focus Financial. 

It was announced in July that private wealth firm Escala Partners had joined Focus Partners Australia, cementing a deal first enacted in 2019. The move saw its Melbourne-based founder and head of advisory Ben James promoted to chief executive and Travis Danysh, who has worked at Focus for a decade, named as executive chairman of Focus’ Australian business. 

Escala was founded in 2013 and has offices in Sydney and Melbourne offering advice to high-net-worth (HNW) and ultra-HNW individuals and family offices. It then entered into a partnership with Focus Financial Partners in 2019 and it became a wholly owned member of Focus Partners Australia in July. 

Under the new structure format, Escala operates as a vertically integrated operating company under the Focus Partners umbrella where Focus provides value-added services to help individual wealth managers grow their business and support them with M&A.

Focus, which has more than US$400 billion in client assets, is far from the only US firm taking interest in Australia with private equity firms CC Capital acquiring Insignia Financial, TA Associates backing Viridian Financial Group, and Oaktree Capital investing $240 million in AZ NGA. 

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Appeal of Australia 

Speaking to Money Management on a visit to Sydney, Danysh said Focus sees multiple attractive factors in the Australian market. 

“We like Australia for the macro trends. It has a similar regulatory environment, and the markets are pretty well aligned; it’s a market we can understand well. Australia has been professionalising since 2019, and there is a similar regulatory framework that people can trust. It would be harder in other jurisdictions.

“Australia is obviously a very affluent country, helped by the superannuation structure, and that makes it a very attractive wealth market. It doesn’t surprise me at all that you’re seeing smart investors and US financial backers look to Australia.”

From Escala’s perspective, James said consolidation is becoming the name of the game in Australia after a period of industry professionalisation following the Hayne royal commission.

“What’s become increasingly evident is everything old is becoming new again. The trend is that bigger is back. Not in terms of control, but in terms of what we are able to offer our clients, especially in the ultra-high-net-worth space, around access and pricing power of investment solutions.

“We’d rather be focusing our fee budget on a differentiated offering that may be more expensive but is market-leading in terms of investment capability that we could never have got access to in the prior world.”

Danysh added: “My own personal view is we are not going to end up in a world where we just have a handful of massive firms, but we are going to see pretty significant consolidation. If you look at the international markets where we have a heavy presence in Australia and Canada, part of the reason we like those markets is we think they’re a little behind the curve from the US in terms of their evolution in the independent space. We can learn a lot from what we’ve seen in the US and apply it to those markets.”

One of the benefits of working with Focus over other competitors, James said, is that most of its senior management have worked in the financial advice field themselves so are understanding of its budget and requirements when Escala is seeking help.

“The old world was mired in bureaucracy. But most of Focus’ senior management have sat in my chair; they’ve been advisers so when we’re asking for solutions that will make a difference to the running of our business, then they’ve seen that before and they’ve done it.

“It’s a refreshing business model and I’m convinced we will be able to attract key talent and an increasing market share of HNW business.”

Adviser growth

Although much industry commentary has focused on the shortfall of financial advisers and the supply/demand dynamics, Danysh is optimistic financial advice will be a self-generating business in the long term. 

Adviser numbers have fallen from around 26,500 in 2019 to 15,300 in 2025 but, likening it to the legal profession, the pair expect this will change as professionalisation efforts over the last five years bear fruit.

Danysh said: “What’s beautiful about this industry is it’s self-generating and people are drawn to the independent space. There’s always consumers wanting advice and there’s always people wanting to work in the industry so there’s a lot of tailwinds.”

“In the legal industry for example, the industry spent a lot of time making it a proper professional service and with that comes natural attrition,” added James, referencing the “adviser exodus” that occurred post-royal commission. 

“But people now recognise wealth management can be a career with a long duration and there’s workplace flexibility. While it may be shrinking at the moment, the long-term future is very powerful and the days of sole advisers are in the past.”

He said Escala is seeing heavy interest from graduates who are looking to join wealth management as an alternative to accountancy or investment banking, a trend which was unlikely to have happened a few years ago. The new generation of advisers are more tech-savvy and digitally engaged and will be ripe to work with Escala’s younger client base in the future amid the intergenerational wealth transfer. 

This is a positive development and has spurred Escala to ensure its digital capabilities are in place to attract younger staff, given earlier commentary from Capgemini that not only do younger, next generation clients "pose a flight risk" but also younger advisers if their firms fail to keep up to speed with technology. 

This report found one-in-three advisers expressed dissatisfaction with their firm’s digital capabilities which they feel is impacting their productivity. Manual processes impeded client service and increased the rate of errors, they said, while others felt unable to connect with clients via digital channels or use digital tools such as portfolio tracking and analytics.

Looking to the future, James can envisage Focus’ backing helping Escala to hold a large presence in the wealth management space. Having the greater resources and the support of a large, global player will enable the firm to hire the best advisers and new talent, provide them with the necessary development, and allow the firm to provide its best offering for clients.

“We think we have the infrastructure to be a far larger business in terms of personnel and assets and we are going through a program to work out the best way to achieve that, but it will only be small add-ons to start with. We’re very aware of maintaining our culture and our approach to service clients, and sometimes getting too big too quickly can take your focus away from that. 

“Anything we do has to ensure our values are aligned. It won’t give too much indigestion and not take us away from servicing our existing client base.”